Jeffrey L. Kingsley, a partner in Goldberg Segalla’s Insurance Regulatory Practice Group, spoke to Law360 for an article exploring potential implications for the U.S. state-based insurance regulatory system of the insurance and reinsurance regulatory negotiations underway between the United States and the European Union.
“One of the frustrations from non-U.S. reinsurers has been the number of capitalization differentiations in the states,” Jeff said. “That uneven playing field, as it relates to capital requirements, positions states to protect whatever rights they want. With those differences, it’s hard to devise some sort of equivalency for greater stability across platforms.”
Noting that the federal agencies will have to perform a balancing act to craft a covered agreement that respects the state-based regulatory regime in the United States, Jeff told Law360, “There are reasons why certain states didn’t adopt the model act. They will want their voices to be heard differently. I don’t think anyone will be happy universally with the covered agreement, but if the FIO and USTR can negotiate the agreement in a way that respects the state regulatory system, that will help ease those concerns.”